A Family-Based Social Contract

On November 13, 2008, the New America Foundation’s Next
Social Contract Initiative and Workforce and Family Program hosted a discussion
around the release of, “A Family-Based Social Contract,”  written by David Gray and Phillip
Longman.  In their paper, Gray, the Director
of New America’s Workforce and Family Program, and Longman, Schwartz Senior
Fellow and Research Director of the Next Social Contract Initiative, argue that
policymakers should focus on supporting parents and children early in life.  Gray and Longman were joined in the
discussion by Reihan Salam, a New America Foundation Fellow and co-author of Grand New Party: How Conservatives Can Win
the Working Class and Save the American Dream.

In his introduction, Gray suggested that supporting families
as citizens and individuals, not as employees, is integral to the next social
contract.  He believes the current
economic anxiety may provide the political will for a reframing of the social
contract.  If so, according to Gray, it must
prioritize families, the most basic and essential social grouping, which are
often taken for granted under existing social policy.

Gray explained that families used to fulfill most important
social contract roles, but major social changes since the mid-20^th
century have altered the traditional roles of families and shifted economic
value to employment.  The benefits of
children are now diffuse, while the costs remain localized.  Gray expressed concern about the value of
paid work versus unpaid work, and dismay about the excessive opportunity cost
of raising children.  These conditions
have profound social implications, including an emerging global “baby bust.”

Gray argued that the next social contract should allow
parents to retain more of the value of having children.  Current public spending on children and those
who help them develop is insufficient.  Moreover,
new social policy should address work-life balance issues, which will be exacerbated
by recession.  In summation, Gray said
that children are now crucial to economic and national security, and that he
was both optimistic and pessimistic about progress in this area going
forward.  He then introduced Phil Longman, co-author of the paper.

Longman opened his talk with a provocative discussion of
whether we could rightly refer to our children as “pets.”  100 years ago, he explained, the average
woman had four children in order to satisfy labor shortages, raise armies, and
ensure that fertility did not fall. 
Today, conversely, we think that the world is overcrowded, and regard each
additional child as just another carbon footprint.  The decision whether or not to have children
is personal, and parents acquire kids because they provide companionship and
love–just like a pet.

Longman suggested that these attitudes towards children and
families have a long provenance: from Hobbes, Locke, and Rousseau onward, all
social contract thinkers have treated the family as a vestigial institution
beyond the scope of the social contract. 
Another tradition, the Malthusian and Darwinian, viewed it as axiomatic
that humans would breed up to the limits of their resources.  None anticipated today’s plummeting global
birth rates, particularly in the developed world.  The U.S.
today is propped up by the high fertility of recent Hispanic immigrants, but
even Mexico’s
birthrates are declining dramatically.

Longman warned that the U.S. is on the threshold of
unprecedented demographic transformation, in which the number of children is
surpassed by the number of seniors.  How
would Malthus and Darwin respond to this inversion of the population
pyramid?  Darwin might claim that seemingly
“successful” couples without children are in fact maladapted to society, and
that the future therefore belongs to religious fundamentalists (the only group
worldwide that is resisting these demographic trends). 

Longman believes, nevertheless, that there is a huge,
pent-up demand for children in our society, as the excess supply of potential
adopters confirms.  But our institutions
effectively “tax away” most of the value of children to parents.  We live in an aging society that “subsidizes
and nationalizes” the economic security of the elderly, yet depends on children
and parents to shoulder the costs of maintaining the system.  The public benefits hugely from parents’
investments in their children, yet our institutions do virtually nothing to
benefit parents.  The terms of the
contemporary social contract get it “completely wrong,” according to Longman:
we “tax” responsible parents to support business and government.  We must instead think about the family as the
primary engine for human capital formation.

So, “What to do?” Longman asked.  Some policy prescriptions are fairly straightforward:
publicly-funded preschool and after-school care, for example, or subsidies for
unpaid domestic caregivers (i.e. parents and extended family).  Unfortunately, however, we simply cannot pay
people enough to incentivize parenthood. 
Longman instead argues for a more fundamental approach that reduces the
opportunity costs of parenthood and eases the trade-offs between starting a
family and pursuing an education and a career. 
New social policy should allow parents to keep more of the value of
their children.  He offered the
hypothetical possibility of reforming Social Security so that payroll taxes
decline as the number of children in a family increases as an example.

Longman concluded that, thanks to a “huge array of factors,”
we are long past the era when we could take families for granted.  The next social contract must recognize the
changing nature of families, and the dependency we place on parents to maintain
our public institutions. 

Reihan Salam opened by noting that Longman’s work on “pro-natalism”
has profoundly influenced his own thinking. 
Reorienting the discussion towards political issues, Salam suggested
that both parties have “inchoate impulses” informed by their constituencies:
Republicans want to address their declining demographic base as the “party of
intact families,” while Democrats want to support families at both the top and bottom
of the economic spectrum. 

Salam surveyed the consumption picture over the last 15
years, and wondered why a climate of rising inequality had not produced a
greater anti-market backlash.  He
concluded that, thanks especially to Chinese imports, the inflation of
consumption of the bottom 10% has been restrained, and a plausible case for
rising living standards could be made. 
However, inflation has been much steeper for consumption among more
affluent families.  This “inflation gap”
means that incomes alone do not tell us very much.  Nevertheless, due to the recent spike in
energy and food prices, the inflation picture may now be converging.  This convergence means increasingly shared
anxiety among both parties’ coalitions.

Salam recommended a shift towards a “life-course” theory of
tax burden, with rates set by one’s stage in life (or, more controversially,
gender).  He believes that family issues
will be addressed by new, ad hoc coalitions, noting that the Family Medical
Leave Act has been championed by both progressives and social conservatives.

Gray moderated the question and answer session that
followed.  Questions touched upon Barack
Obama’s “Blueprint for Change” and its directive to “Make Work Pay,” the high
cost of raising families in Asian societies, potential demographic arrogance in
the developed world, debilitating social norms about the role of men, and a pop
culture that tracks celebrity pregnancies obsessively and glamorizes super-sized
families. 

Participants
Featured Speakers
Phillip Longman
Schwartz Senior Fellow and Research Director, Next Social Contract Initiative
New America Foundation

Reihan Salam
Fellow, New America Foundation
Co-author, Grand New Party: How Conservatives Can Win the Working Class and Save the American Dream

Moderator
David Gray
Director, Workforce and Family Program
New America Foundation